"Investors have been bracing for the downgrades since February, when the Moody's Corp. unit said it would review the ratings of more than 100 banks around the world. U.S. bank stocks rose in after-hours trading Thursday, after Moody's announced the downgrades. The gains followed a broad-based selloff that saw the Dow Jones Industrial Average fall 250.82 points to 12573.57."

It's worth remembering that Moody's and other credit-rating agencies such as Standard & Poor's, "got a black eye for placing high ratings on mortgage bonds that later imploded," according to The New York Times.

The downgrades will lead to higher borrowing for the affected banks, and that's not good news for consumers, the Times notes:

"As bank profits falter, consumers could also be affected. Companies often try to make up for lost revenue by passing costs on to customers.

"In the face of new regulations, banks have raised fees and other sources of income to bolster their business."